January 22, 2013
A press release on the FHA/HUD official site announces a settlement in a disability discrimination claim brought by HUD against U.S. Bank. According to HUDNo.13-008, “Minnesota-based U.S. Bank National Association will pay $12,000 to a loan applicant with disabilities under a Conciliation Agreement settling allegations that the bank required him to provide unnecessary documentation to establish he would continue receiving disability income for three years before they would approve his mortgage loan.”
As the press release states, the Fair Housing Act makes it an offense to discriminate “in the terms and conditions of a loan based on a person’s disability, including by imposing different loan application or qualification criteria.” According to the press release, a complaint was filed with HUD after U.S. Bank required a borrower to show proof that his disability payments would continue for three years. According to the press release, “Additional documentation was not needed because Social Security award letters without expiration dates establish continuity of income” for the require threed years.
“Holding persons with disabilities to a different standard because they rely on disability-related income violates the Fair Housing Act,” said John Trasviña, HUD Assistant Secretary for Fair Housing and Equal Opportunity. “Reasonable income standards are a necessary part of the underwriting process but HUD will continue to take action when these practices are discriminatory.”
What is the result of the settlement? According to HUD, U.S. Bank agreed to pay the applicant “$12,000, accept SSI award letters as establishing at least three years’ income, and refrain from requiring applicants receiving disability income to provide doctors’ statements concerning the nature, severity, or duration of a disability.”
We report these cases here because any time an FHA, VA or conventional borrower experiences such discrimination, they are often the only ones who can–by filing a formal complaint with the FHA/HUD–get recourse and prevent further abuses from happening. Any borrower who feels they have experienced such discrimination in the home loan process should call 1-800 669 9777.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
Browse by Date: